In recent studies we focused on cell-cell fusion in development (submitted) and membrane fusion stage of cell entry by dengue virus (DENV). As many enveloped viruses such as influenza and hepatitis C viruses, DENV enters host cell via endocytosis and fuse their envelopes with endosomal membrane to deliver viral genome into cytosol. Recently we discovered that DENV fusion requires the target membrane to contain anionic lipids such as bis(monoacylglycero)phosphate, a lipid specific to late endosomes, and phosphatidylserine (Zaitseva et al., 2010, 6(10): e1001131). This finding has explained why DENV fuses only in late endosomes, while activation of DENV protein fusogen glycoprotein E is triggered already at pH characteristic for early endosomes. Based on identification of anionic lipids as a pre-requisite for DENV fusion we designed several novel assays of DENV entry. For many viruses fusogenic activity can be conveniently monitored by measuring lipid mixing between viruses and liposomes. However, development of a virus-liposome fusion assay for DENV fusion has proved to be surprisingly challenging with lipid mixing between DENV and anionic-lipid-free liposomes very inefficient. We developed a simple quantitative assay of fusogenic activity of DENV towards anionic-lipid-containing liposomes based on labeling dengue virions with self-quenching concentration of a fluorescent lipid DiD. In the first application of this fluorescence dequenching assay of the DENV fusion we focused on one of DENV neutralizing antibodies. Identification of the epitopes of strongly neutralizing antibodies to protein E and mechanisms by which these antibodies neutralize DENV are important for vaccine development. The envelope glycoprotein E, responsible for target cell recognition and cell entry consists of three structural domains DI, DII and DIII. At one end of the protein E ectodomain is the fusion loop within DII and at the other end is DIII, which is involved in host cell binding. The ectodomain is attached to the viral membrane by an amphipathic stem region. Within acidified endosome pre-fusion homodimers of protein E dissociate into monomers and insert their fusion loops into the endosomal membrane. The E re-assembles into trimers with their fusion loops at the tip of a trimeric spike oriented towards the endosomal membrane. Folding back of DIII and stem regions against the lateral surface of the trimer brings membrane-interacting regions of the protein: fusion loops and transmembrane domains, to the same end of the rod-like post-fusion conformation of protein E trimer and, thus, brings the viral and endosomal membranes together. We found that the chimpanzee monoclonal antibody (Mab) 5H2 potently neutralizes DENV-4 by binding to domain I of protein E. Crystal structures of Fab 5H2 in complex with DENV-4 sE and isolated recombinant DI provides a snapshot of an intermediate conformation of this domain during protein E refolding between known pre- and post-fusion structures. The crystal structure of Fab 5H2 bound to protein E from DENV-4 shows that antibody binding prevents formation of the fusogenic hairpin conformation of protein E. This finding suggested that 5H2 should block fusion stage of DENV entry. Indeed we found this antibody to inhibit virus fusion with anionic lipid-containing liposomes. DENV-4 virions whose membranes had been pre-labelled with a self-quenching concentration of the fluorescent lipid DiD, were incubated with various concentrations of Mab 5H2 and mixed with liposomes. Fusion of the viral membranes with the liposomes was then induced by acidification to pH 5.5, resulting in dilution of DiD in the liposomes and an increase in DiD fluorescence due to de-quenching. Mab 5H2 inhibited lipid mixing in a dose-dependent manner to levels comparable to those observed for two fusion-blocking human Mabs against West Nile virus. These findings suggest that antibody 5H2 neutralizes DENV-4 by blocking membrane fusion within the endosome. Competition ELISA experiments with serum samples from patients convalescing from secondary DENV-4 infections, suggest that some antibodies in patient sera bind to epitopes on DI that overlap with that of Mab 5H2. Thus, analysis of 5H2 epitope and neutralization mechanism can help in effective vaccine design to prevent dengue disease. The dequenching assay of DENV fusion that we used in this study for functional characterization of neutralizing antibody 5H2 and different modifications of this assay including intracellular fusion assay, virus-cell binding assay and high throughput versions of these assays will help in characterization of other neutralizing antibodies and potential antivirals.